Significant First Exploration Target Range for Toro’s Theseus Uranium Project in WA ASX RELEASE Tuesday, 15 November 2011 Toro Energy Limited (ASX: TOE, “Toro”) is pleased to provide the following Exploration Target Range for its 100%-owned Theseus Uranium Project in Western Australia: 20Mt to 40Mt @ approx 400 to 500parts per million (ppm) U 3 O 8 , for 10,000t to 20,000t U 3 O 8 or 22Mlb to 44Mlb U 3 O 8 # . # CAUTIONARY STATEMENT The Exploration Target Range (ETR) is conceptual in nature and there has been insufficient exploration completed to define this material as a Mineral Resource. There is no certainty that the further work referred to herein will result in the determination of a Mineral Resource. This Exploration Target Range (ETR) will be evaluated by mud rotary drilling during 2012, following the results of studies of disequilibrium and bottle roll leach testing. Studies will focus on recovery characteristics and the potential to improve uranium grades from gamma data collected so far. Following the highly successful Theseus 2011 drilling program, Toro has estimated the project’s ETR by using a compilation of individual drillhole downhole gamma, prompt fission neutron (PFN) and assay results. This information plus the exploration potential along extensions of the defined palaeovalley system at Theseus, forms the basis of the ETR. Figure 1 highlights the higher-grade uranium intercepts expressed as grade thickness (GT) values from within the newly defined mineralised zone at Theseus. This mineralised zone, roughly 10km x 2km, is bounded within a palaeovalley system mapped using basement intercepts from drilling. Significantly, the mineralised zone is open to the northwest, east and to the southeast. Figure 1: Theseus Drilling Plan showing drillholes with assigned GT over regional depth to basement contour image
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Significant First Exploration Target Range for Toro’s Theseus Uranium Project in WA
ASX RELEASE Tuesday, 15 November 2011
Toro Energy Limited (ASX: TOE, “Toro”) is pleased to provide the following Exploration Target Range for its 100%-owned Theseus Uranium Project in Western Australia:
20Mt to 40Mt @ approx 400 to 500parts per million (ppm) U3O8, for 10,000t to 20,000t U3O8 or 22Mlb to 44Mlb U3O8
#.
# CAUTIONARY STATEMENT The Exploration Target Range (ETR) is conceptual in nature and there has been insufficient exploration completed to define this material as a Mineral Resource. There is no certainty that the further work referred to herein will result in the determination of a Mineral Resource.
This Exploration Target Range (ETR) will be evaluated by mud rotary drilling during 2012, following the results of studies of disequilibrium and bottle roll leach testing. Studies will focus on recovery characteristics and the potential to improve uranium grades from gamma data collected so far. Following the highly successful Theseus 2011 drilling program, Toro has estimated the project’s ETR by using a compilation of individual drillhole downhole gamma, prompt fission neutron (PFN) and assay results. This information plus the exploration potential along extensions of the defined palaeovalley system at Theseus, forms the basis of the ETR. Figure 1 highlights the higher-grade uranium intercepts expressed as grade thickness (GT) values from within the newly defined mineralised zone at Theseus. This mineralised zone, roughly 10km x 2km, is bounded within a palaeovalley system mapped using basement intercepts from drilling. Significantly, the mineralised zone is open to the northwest, east and to the southeast.
Figure 1: Theseus Drilling Plan showing drillholes with assigned GT over regional depth to basement contour image
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Background Theseus was discovered by Toro during a grassroots regional aircore drilling program by the Company in 2009. Initial results highlighted the potential for sandstone hosted uranium mineralisation at Theseus. Drilling in 2011 has now confirmed the presence of significant uranium mineralisation. A total of 130 vertical mud rotary and aircore holes have now been drilled and downhole gamma logged at the project. Almost 50% of the holes (64 of 130, drilled at Theseus) report a gamma, assay or PFN result greater than 0.5m @ 100ppm U3O8. All Theseus drillhole location and drill intercept information is tabulated in Appendices 1 and 2. The 2011 drilling program at Theseus (Figure 1) has defined in detail, a small portion of the regional palaeovalley system broadly outlined by regional drilling in 2009 and 2010 (Figure 2). The upper interval of the palaeovalley fill is dominated by clay and is mostly oxidised. The lower section of the palaeovalley fill, between about 90m and 130m, comprises alternate layers of sand and clay that are variably oxidised and reduced. In the deepest sections where the palaeovalley is juxtaposed against basement, the sediments are mostly reduced, and locally carbonaceous, lignitic and pyritic.
Figure 2: Exploration potential extending from the Theseus Project
Figure 2 shows three discrete palaeovalley systems that based on Toro’s experience of drilling in 2011 have the potential to be as prospective as Theseus. Each area reports anomalous intercepts at kilometre spacing worthy of follow up in 2012.
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Uranium mineralisation is hosted within the variably oxidised sand-clay sequence and its distribution is concentrated at boundaries between reduced and oxidised sediments (“redox” boundaries). The thickest and highest grade mineralised intercepts are hosted within sands ranging from 1m to 6m thick, while thinner intercepts are localised at the upper and lower boundaries of sand units. This distribution is consistent with the classic “roll-front” style of mineralisation as shown on Figure 3.
Figure 3: Well cad-type cross section for holes LM0060, LM0059, LM0064, and LM0014 showing 50m to 140m, including down-hole gamma intersections and the interpreted distribution of sand-hosted “roll-front” style uranium mineralisation.
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Figure 4: Typical summary cross-section for the southern part of the Theseus Project
A typical cross-section for the southern part of the project is shown in Figure 4 with mineralisation located towards the steeper eastern flank of the palaeovalley. Drill holes LM0045, LM0052 and LM0055 all report the tenor of mineralisation typically considered “ore-grade” in ISR type operations in Australia and overseas. Drilling on the western flank of this palaeovalley failed to intersect significant uranium suggesting that mineralisation may be concentrated on the steeper flanks of the palaeovalley system, in this case on the eastern side. Higher grade uranium is also noted on other cross sections associated with steep flanks to the palaeovalley. Studies are underway that are designed to provide information on leaching parameters and uranium speciation. It is hoped that this information will be available by the end of this year. In conjunction with this work, disequilibrium studies are being carried out on samples to determine the gross magnitude and distribution of disequilibrium. Sampling of aircore chips has proven to be problematic given high water flows and fine sands being removed by the aircore drilling technique.
The main intersection logged with both natural gamma and PFN in LM0055 and shown in Figure 4 was reassessed by combining deconvolved data from two discrete gamma surveys and comparing directly to the PFN result. This intersection is now confirmed as:
1.56m @ 0.16% pU3O8 [0.25%GT] from 112.43m from the PFN compared to
4.28m @ 0.06% eU3O8 [0.25%GT] from 111.15m from down-hole gamma.
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This comparison adds confidence in the use of deconvolved gamma data given the similar GT value for this drill-hole. A full program of PFN logging will be scheduled for next year. Toro Managing Director, Mr Greg Hall said: “Theseus has to date been a major success story for Toro and one that is yet to be fully recognised by equities markets as a major grass roots uranium discovery. It is becoming clear that Theseus may only be one prospect within this new uranium province and the region has the potential for further major discoveries. Toro believes that the Exploration Target Range announced today is only a small indication of the significant potential of this region.” Greg Hall Managing Director
MEDIA CONTACT: Greg Hall Toro Energy 08 8132 5600 Kevin Skinner Field Public Relations 08 8234 9555 / 0414 822 631
Toro Energy is a modern Australian uranium company with progressive project development, acquisition and growth. The company is based in Adelaide, South Australia with a project office in Perth, Western Australia.
Toro’s flagship and wholly‐owned Wiluna uranium project (includes existing mining lease) is 30 kilometres southeast of Wiluna in Central Western Australia.
Wiluna contains two shallow calcrete deposits, Lake Way and Centipede, with prefeasibility and optimisation studies completed and technical work leading to a definitive feasibility study underway. Toro has commenced the Approvals process targeting the Company’s first uranium production late 2013.
Toro has three other exploration and development projects in Western Australia, and owns uranium assets in Northern Territory, South Australia and in Namibia, Africa.
www.toroenergy.com.au
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Information in this report is based on information compiled by Mr Mark McGeough, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr McGeough is a full-time employee of Toro, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr McGeough consents to the inclusion in this release of the matters based on his information in the form and context in which it appears.
Information in this report relating to Deconvolved Gamma Results, is based on information compiled by Mr David Wilson BSc MSc who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Wilson is a full-time employee of 3D Exploration Ltd, a consultant to Toro and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Wilson consents to the inclusion in this release of the matters based on his information in the form and context in which it appears.
* Downhole gamma logging of drill holes provides a powerful tool for uranium companies to explore for and evaluate uranium deposits. Such a method measures the natural gamma rays emitted from material surrounding a drill hole. Gamma radiation is measured from a volume surrounding the drill hole that has a radius of approximately 35cm. The gamma probe is therefore capable of sampling a much larger volume than the geological samples recovered from any normal drill hole.
Gamma ray measurements are used to estimate uranium concentrations with the commonly accepted initial assumption being that the uranium is in (secular) equilibrium with its daughter products (or radio- nuclides) which are the principal gamma ray emitters. If uranium is not in equilibrium (viz. in disequilibrium), as a result of the redistribution (depletion or enhancement) of uranium and/or its daughter products, then the true uranium concentration in the holes logged using the gamma probe will be higher or lower than those reported in this announcement.
The logging of aircore was undertaken by Toro Energy Ltd utilising an Auslog Logging System. The gamma tools were calibrated in Adelaide at the Department of Water in calibration pits constructed under the supervision of CSIRO. Toro Energy carries out regular recalibration checks to validate the accuracy of gamma probe data.
The gamma ray data was converted from counts per second to eU3O8 using calibration factors obtained from measurements made at the calibration pits. The eU3O8 data was also adjusted by an attenuation factor, determined onsite, due to logging in drill rods. These factors also take into account differences in drill hole size and water content. The eU3O8 data has been filtered (deconvolved) to more closely reproduce the true grades and thicknesses where thin narrow zones are encountered.
The various calibration factors and deconvolution parameters were calculated by David Wilson BSc MSc MAusIMM from 3D Exploration Ltd based in Perth, Western Australia.
Bore Hole Geophysical Services based in Perth, WA collected down-hole gamma measurements along with density and resitivity measurements in mud rotary holes.
Downhole gamma and PFN measurements in hole LM0054 and LM0055 were collected by GAA Wireline of Mt Barker SA. For further information on the use and calibration of the PFN readers are directed to the GAA Wireline website www.gaawireline.com
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Appendix 1: Final summary of Theseus mud rotary drill-hole locations and significant uranium results